How to display and use Vertex Color from OBJ model
As others stated, the OBJ format specification officially does not have the ability to contain any vertex color information, but some apps extend the format to support this feature (RGB values are appended after vertex position values).

I managed to modify the Blender's OBJ importer to import &amp; assign vertex colors as well.

Caution - the current implementation is really dirty at this moment (I am going to dig into the code more in the future), also I have not tested it properly so some bugs can occur.

DOWNLOAD / HOW TO USE

To try the modified importer, download the latest version of the import_obj.py script from my GitHub repo and replace the original one located in blender\2.x\scripts\addons\io_scene_obj (make a backup of the previous one, of course).

Then just cross all your fingers and try importing an OBJ model. To see vertex colors clearly, create &amp; assign a new material to the object, set it Shadeless and enable Vertex Color Paint in Options. Then just set the 3D view shading to Material (as in the gif below).

This is an example of an OBJ model exported from http://www.cs.nott.ac.uk/~psxasj/3dme/index.php and imported using the modified importer:


Please let me know whether it works for you!